You deposit $509 in a savings account and one year later you have $562. At the same time, the CPI increases from 126 to 143. What was your real interest rate, in percentage terms?

real interest rate = -3.08%

Explanation:

real interest rate = nominal rate - inflation rate

real interest rate = 10.41% - 13.49% = -3.08%

since the real interest rate is negative, the investor actually lost money in real dollars. This means that the amount of goods that the investor could purchase before making the investment is higher than the amount of goods he/she will be able to buy after the investment.

engine assembler, survey reasearcher, auditor

a manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. at the end of december, the company wishes to forecast sales for january. the estimate of trend through november has been 200 additional boards sold per month. average sales have been around 1000 units per month. the demand for december was 1100 units. the company uses α = 0.20 and β = 0.10. make a forecast including trend for the month of january.